Coming soon to a container near you?

Tired of waiting in line for top-dollar tickets to the information extravaganza promised by RFID technology? Depressed by the thought of that off-off-Broadway low-budget show where men in brown coats laboriously scan bar codes one by one? Beep. Pause. Beep. It's hardly toe-tapping stuff.

Well, the stage is set for a smart, sassy alternative in automatic data collection entertainment, with a medium- priced ticket: two-dimensional bar codes or color dots that can be read hundreds at a time.

Hans Mueller, vice president of pool management and technology at Ifco Systems GmbH, is helping ImageID Ltd., an Israeli company, take a technology originally developed to identify individual images in online photo albums and put it on the logistics stage. If Ifco's experience is anything to go by, the idea may hit it big.

The technology is called Visidot, and in some ways it's not really new. It uses two-dimensional visual coding—either a colored dot or a Data Matrix 2- D bar code—to store up to 3,000 characters of information.

When it comes to capacity, two-dimensional symbols have an enormous edge over the traditional linear bar-code symbologies (like Code 39 and UPC). While traditional symbologies can only encode 10 to 20 characters of information, 2-D symbologies can encode several thousand characters of machine-readable data. (Data Matrix is one of the three most popular two-dimensional bar codes, the others being PDF417 and MaxiCode.) In effect, a portable database can travel with the product. The beauty of the technology is that, although the scanners are almost as expensive as RFID readers, the cost of the labels is negligible. As proponents of the technology point out, you're already printing a label on your boxes.Adding another printed symbol next to the product code isn't going to add much to the cost.

In living color
"Due to the precedent being set by Wal-Mart and the DOD, many companies are jumping on the RFID train even though it may not be the best solution for their needs," says Rami Kopelman, vice president, sales and marketing of ImageID, the Tel Aviv-based company that developed Visidot. "Visidot offers an accurate and less expensive option that is more appropriate for certain environments than RFID."

What sorts of environments would these be? Well, for starters, Visidot is potentially useful when RFID is too expensive and simple bar coding too rudimentary. But Kopelman predicts that what will really win over the audience is Visidot's ability to read a lot of tags or labels at once.

Independent research shows that, while RFID is in theory able to do that, the read-accuracy rate with multiple tags closely packed together still leaves a lot to be desired—some estimates put accuracy rates as low as 70 percent. (By contrast, Ifco reports read accuracy rates for Visidot codes of 99.7 percent.) Furthermore, RFID is notoriously skittish around metal containers—something to do with metal interfering with the radio signal—which is a considerable drawback in a world where items ranging from soda to motor oil come packaged in metal or metallic materials.

"You have the legacy of linear bar codes where you read them one by one. Then there's the Holy Grail of RFID, that one day you'll be able to set up a reader and any pallet that moves through will give you information.We're in between. We're giving everything that RFID technology promises but won't be able to deliver for perhaps 10 years," Kopelman says. "We can give it today."

So how does it work? The Visidot system uses an information-capturing device with a wide field of vision, "so we can decode multiple dots within a second—hundreds or even thousands," says Kopelman. For many applications, the color-dot version has the advantage over its 2-D Data Matrix code counterpart because the dot doesn't need to be as large as its monochrome co-star, and it can still be read even when the scanner is at a 60-degree angle to the plane of the dot's label. The color dot's downside is that decoding its symbology requires a proprietary technology that's not standardized like the European Article Number (EAN) codes associated with the 2-D Data Matrix symbology. That means you need a supply chain that involves a limited number of participants who all agree to use the proprietary system.

Click and track
At this point, the company most familiar with the Visidot's strengths and weaknesses is Ifco Systems, which has been beta-testing the system for the last three years. Ifco is not only the largest recycler of wooden pallets in the United States, but it also runs a wide-ranging operation in Europe, where it makes returnable plastic container (RPC) systems and distributes them to customers —mostly food producers—who fill them and ship them to their own customers. Ifco then arranges for the containers to be picked up. Although Ifco is not responsible for physically moving the containers, it is responsible for tracking them and providing information about the whereabouts of the containers (and their contents). It collects tracking information from partners in the supply chain and makes it available to customers, as a side benefit to its own need to know where its assets are. Well, at least that's the theory. Until recently, Ifco, which owns 60 million containers in Europe alone, had little idea where every container or pallet was, who was responsible for it, or when it was likely to be returned.

"Before Visidot, they were renting out different types of crates, and they had only a vague idea of how many were where—how many in the depot, how many in the customers' hands, how many returned.Now they have a private ID for each crate and can know ? how many are in the depots, how many are lost and who lost them, so they can bill the customer," says Kopelman.

All that's a lot of information to keep track of, so Visidot also comes with a Web-based data management system. "We provided them not only with a data-capturing system, but [also with] a very complex Web-based track and trace data system," Kopelman adds. "You can access it from anywhere in the world and see the status of each and every crate, or depot, or any kind of cross section you want."

Selective service
So after three years of testing, what's Ifco's assessment of the Visidot? Mueller cautions that the technology, which requires a line of sight, isn't for everyone, but he reports that it works well for certain segments of his business. "If you don't have visible contact with your goods, you can't use this technology. But if you're using it like multiple-read bar codes, where you can read multiple items with one shot, then it makes sense,"Mueller says. "At the moment, we can read a 500-item pallet with one photo."

Mueller also warns that the technology isn't for every application. Ifco uses the technology only selectively at present —specifically in its Paris facility,where the company provides containers for meat products shipped throughout France, and in four facilities in Germany. Mueller says that, even then, the company uses the Visidot in combination with the standard bar code and normal letters, so that there is always a way of identifying the packages by eye as well. "If a color code isn't readable because it's covered or scratched, we can type in the GRAI (Global Returnable Asset Identifier) code and find out which asset it is, or we can use the standard bar code," says Mueller.

The need for backup bar codes notwithstanding, Mueller considers the extra information Visidot provides to be a boon. "Without this information we can just guess what turn rate we have. Now we have a detailed view of our pool and can see how long an individual crate takes to come round. We also know what product is in the crate at the moment."

And the bottom line is that, for Mueller, simply being able to automate the process of counting containers in the warehouse is a big plus. "Knowing how many assets you have in the warehouse without doing a manual count, this is a huge advantage," he says.

Another advantage is that the Visidot reader is an advanced imaging device—it effectively takes a photo of the codes. That gives users the option of storing those images in an "image bank." Installed on a dedicated server, the images can then be used as visual proof of such things as a container's condition upon shipment or arrival. Another use would be to pinpoint the actual physical location within a shipment of an individual item for removal or substitution further along the supply chain.

This could be an enormous boon in the case of a food disaster.Mueller is glad to say he's never had to recall a shipment of food, but what if a particular brand of sausage were found to contain meat infected with BSE (mad cow disease)? Recalling individual packages of sausages from a larger mixed shipment was impossible before. Even finding individual RPCs or clusters of them would have been next to hopeless. Now, in theory, a product recall would be fast and would target only the suspect goods, not everything shipped in the same container or pallet.

2D or not 2D?
So far, it has to be said, the line for this new product hasn't stretched round the block. Visidot has a mere five customers in the United States, but Kopelman says the technology has only been available here for six months or so. Certainly, folks are looking around for alternatives to pricey RFID and limited bar coding. "I think RFID is being overhyped. I don't think there's a real good ROI for the kind of applications that Wal-Mart is using. I don't think of automatic data collection as just bar codes. Now, you're capturing data in real time and using that data," says Steve Banker, service director for supply chain management with ARC Advisory Group in Dedham, Mass. But he's not convinced 2D codes are for everyone either, citing other alternative or supplementary technologies such as voice recognition and global positioning systems.

Still, for Kopelman, the show must go on, so he's working hard on pitching the idea.

He asks you to imagine a warehouse that is shipping out pallets with mixed product in mixed boxes, assembled by order pickers. "When it's being shipped with our technology, we can install a scanner on the loading dock, which does a quick scan, decoding all the bar codes on goods ready for loading. It can compare those codes to the pick list, and it gives a green light if it's OK or a red light if not," Kopelman says. If there's a problem, the dispatcher will see on the screen a cross over the dots of the boxes that shouldn't be there, and can remove them quickly, or will be alerted on screen to the boxes that should be there and aren't. "That can save warehouses a lot of time and money," Kopelman points out. "It saves having someone stand there doing a manual scan of bar codes one by one, or relying on people to load the right stuff onto the pallets. That leads to lots of errors and goods you'll never see again, or complaints from the customer."

Impressive, to be sure, but is the technology worth the price of admission? It may well be. According to Kopelman, customers usually see a return on their investment in just a couple of months.

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